Issue CCXXIV

Carbon Newsletter

DBLM Solutions
17 Dec 2015

The EUA Dec14 contract is currently at 8.32.

The market rarely reacts to UN
Climate
Conference proclamations as their timescale
reaches over decades. The fact remains that the
huge surplus of EUA's still hinders the desired
increase in carbon prices to support the
proliferation of renewables. As things stand, the
surplus is forecast to remain in place until 2022.
The short term forecast looks neutral as the
bottom of the current range held firm when
challenged n Monday. It is likely that we may
see the 8 mark challenged over the coming
days.
Weekly
Recap

ICE EUA
Spot

ICE CER
Spot

ICE EUA
Dec16

ICE CER
Dec16

10/12/2015

8.34

0.56

8.36

0.54

11/12/2015

8.08

0.52

8.07

0.54

14/12/2015

8.05

0.52

8.08

0.52

15/12/2015

8.20

0.53

8.16

0.52

16/12/2015

8.10

0.54

8.19

0.48

Volumes lots

1,444

106,118

1,567

Week %

-2.87%

-3.57%

-2.03%

-11.11%

The EUA/CER spread narrowed this week at

7.56, at close of business last night versus the

7.86 spread we witnessed last week and 7.91

the week before.

Auctions
EEX held auctions last Thursday, Friday & Mon,
Tuesday & Wednesday. Auction prices were
8.32, 7.98, 7.92 & 8.05 respectively. The
cover ratios for the above auctions were 3.47,
2.56, 1.98 & 2.53 respectively. (Cover Ratio =
Number of bids/Auction Volume)

UN Climate Conference
So, all the fuss is over, EUA's dropped 6% over
the two weeks of the conference and it seems
there is little more than an overall target for
Nations to aim at. The protocol now aims to keep
temperature rises below 1.5oC by the end of the
century. The efforts of Nation states are outlined
in NAMA's (Nationally appropriate Mitigation
actions). However, following the conference
conclusion, a certain amount of negativity was
spread around current NAMA's only achieving a
3oC temperature rise. However, a review clause in
in place with the first scheduled in 2018 to allow
Nations strengthen their commitments on
mitigation. The landscape is gradually changing
as a collossal vacum is created outside the carbon
compliance sectors. The solution will be a
combined effort between the public and private
sector. Watch this space.

The contents of the Newsletter is not a recommendation, either implicit or explicit, to buy or sell emission permits.
Contact: David Boles, Compliance Markets -Direct: +3531 4433 584; Mob: +353 831747707
DBLM Solutions is partly funded by the Wicklow Enterprise Board.